The Four Types Of Direct Mail Promotions
Jay Abraham has strong opinions on how to make direct mail work There are four types of direct mail promotions:
1. Direct sales (asking for the order).
2. Lead generating (asking for an inquiry).
3. Third-party endorsement (such as host/parasite deals).
4. Database marketing (mailing to your own customers).
The List Is The Most Important Factor
No one will buy your product or service if they're not interested in it. You should only mail to people who have a history of buying your type of product or service or who are logically predis- posed to what you're offering.
There are two types of mailing lists:
1. Compiled (such as directories, phone books, etc.).
2. Direct response (which includes those people who have ordered through the mail before and have a proven history of being responsive). You can buy such lists through list brokers. They are sorted according to nature of purchase, cost, demographics or psychographics, so you can target your mailing to an especially responsive audience.
In most cases, compiled lists do not pull as well as direct-response lists. Always use direct- response lists before you try compiled lists (unless there are no direct-response lists for your market).
Components Of A Direct Mail Package
The carrier envelope: The outside packaging which holds the components. It needs to be enticing enough so that it won't be considered just another piece of "junk mail" and end up in the recipient's trash.
Accordingly, there are a multitude of decisions to be made about the carrier envelope, like size, color, postage (meter versus live postage), paper stock and color, whether it should include a "teaser" (copy printed on the outside that will entice the recipient to open it) and so on.
A word about teaser copy. Many opt not to use teaser copy because it immediately distin-
guishes your package as "junk mail." However, teaser copy may also lure the reader into opening an otherwise nondescript envelope. Weigh your decision in the matter of teaser copy thoroughly and choose your copy carefully.
The letter: The actual sales pitch — the "beef" of your package. It relays what the product is, how it can benefit the customer... in short, everything that a traditional sales pitch does.
A brochure: An advertising piece that should further your pitch — usually more glossy and colorful than the letter.
A lift note: Any very brief, introductory, easy-to-read note that prompts the recipient to con- tinue reading.
176______________________________________________________________DIRECT MAIL MARKETING An order form: Keep it simple: Standard size, with easy-to-understand, clear and concise
wording.
A reply envelope: Makes it convenient for the customer to return his order form to you.
Mail-order advertising must tell a complete story to make an immediate sale. There are no limitations on the amount of copy. The motto is, "The more you tell, the more you sell."
Mail-order can be solo, it can preface sales calls, it can follow sales calls, it can preface telemarketing, it can follow telemarketing.
In the last decade or so, a set of "rules" has been established in the direct mail industry that provide guidelines on how to write a good letter, how to call the buyer to action and so on.
Marketing courses, books and seminars have made these rules widespread. As a result, many direct mailings have become similar in content and appearance.
I advise against doing anything wildly different to set your mailing apart. These rules have become widely used because they work. Testing has proven what techniques work and which don't. So I advise you to stick with the "tried and true" format.
There is still room for doing things innovatively to make your direct mailing stand out. Just keep your creativity balanced and within the realms of good taste. It's OK to experiment, but do so cautiously. Carefully consider any changes.
You can use direct mail to prospect nationally or locally to target narrow audiences, like doctors, lawyers, plumbers, new mothers, right or left-wing political donors, people who own BMWs or airplanes, pilots, accountants, school teachers, maintenance engineers, or... you name it!
You can use direct mail immediately after a sales or service call to reduce or eliminate refunds or complaints.
You can use direct mail to solicit or work special segments of your customer base where it would not be practical to mass-solicit. For example, you may have 10,000 customers, but only 500 are high-ticket buyers interested in high-end products like expensive shoes or sweaters. It's not feasible to mail a letter to all 10,000 clients about your new stock of expensive sweaters when you want the message to go to only 500 primary prospects. Segmenting mailing lists allows you to focus your offer on the right prospects.
You can use direct mail to promote store traffic by letting potential customers know who, what and where you are.
You can use direct mail to introduce your product, service or business to specific new areas of your marketing community when your business expands.
You can use direct mail (instead of display advertising) to generate a list of favorably disposed prospects. Then you can have salespeople solicit them, cutting your sales expense by half.
You can use direct mail to identify and attract any customer, prospect or industry market. You can use direct mail to revitalize former customers or prospects.
You can use direct mail to immediately multiply your sales force 5,000, 10,000 or 100,000 times, all for a mere 35 cents or so per salesperson. You can use direct mail to generate leads when it's too expensive to send salespeople out cold-calling.
You can use direct mail to recruit salespeople, executives and specialized personnel anywhere in the country by zeroing in on targeted lists of specialized professions.
You can use direct mail whenever your company is stuck with overstocked, slow-moving, imperfect or undesirable inventory or with excess labor capacity you need to put to use. You can use direct mail to add a mail or telephone order division to your store operations.
DIRECT MAIL MARKETING_____________________________________________________________177 You can use direct mail to quickly and accurately test all sorts of sales, pricing, conceptual and
packaging propositions. Test results will tell you how to expand the application of the tested concept on TV, radio, print, outside sales calls and telemarketing.
You can use direct mail to promote high-ticket, high-profit products when you don't want to tie up your money in inventory. By utilizing direct mail to pre-sell special-order items, you not only get prepaid orders for positive cash flow, you also can pre-book enough advance orders to enable you to negotiate a better price from the supplier. And that's just for starters.
Once you've mastered direct mail, you possess a potent marketing tool that can stretch your marketing abilities many times over.
Using Computers To Target Your Best Mailing List
Direct mail has exploded because it is the fastest growing, most profitable and most easily traceable means of marketing thanks in part to the phenomenal growth and sophistication of computer programming and the availability of highly specialized mailing lists, categorized by every imaginable classification. Readily available are compiled lists that categorize virtually everyone: attorneys, golfers, company presidents, company personnel managers, company fleet managers, computer experts, members of Elks Lodges, swimming pool owners, dog owners, horse owners, gardeners, tennis club members or what make, model and year of car people own.
That's merely the beginning of the new and sophisticated ways you can microscopically focus on prospects for any business product. Want to know who subscribes to any of a thousand
different magazines, journals, newspapers and newsletters? No problem: You can readily rent the subscribers of all but a tiny handful of publications. Wish you could tap into the people who bought merchandise from The Sharper Image? Hey, that customer list can be rented. So, too, can the customer lists of nearly 5,000 other mail-order firms.
Likewise, you can rent lists of voters, of donors, of churchgoers or of any demographic desig- nation you can dream up. Thanks to the magic of computers, you can eliminate the possibility of duplicating names, even if you rent a hundred lists. You can avoid wasting your money mailing to people who hate "junk" mail. You can personalize every letter by name, address and saluta- tion. It only costs a mere 25 to 35 cents to personalize each letter!
And, you don't have to sniff around in a million different places in order to ferret out these
mailing lists. Standard Rate and Data Service (1-800-323-4801; 3004 Glen View Road, Wilmette, IL 60091) and R.L. Polk and Co. (404-447-1280; 6065 Atlantic Blvd., Suite E., Norcross, GA 30071) can provide you with catalogues of their lists. Or check your local Yellow Pages under
"Mailing Lists."
Read Your Mail, See What "They" Are Doing
Direct mail has grown into a multi-billion dollar industry. The major players who've discov- ered the gold mine of opportunity include magazine and newsletter publishers, catalogue com- panies, department stores and record and book clubs.
The next time you come home and find a stack of so-called junk mail in your mail box, don't pitch it into your round file! Take a few moments to read a letter or two.
People don't keep mailing these letters because they don't work. They mail hundreds of mil- lions because they do work. You, too, can tap this potential marketing technique. All you need is a basic understanding.
The Reasons You Should Use Direct Mail
With conventional advertising (like TV or display ads) it's hard to identify and correlate results.
But direct mail provides the tools to measure your results to the penny. You can test and compare all sorts of marketing possibilities.
178_____________________________________________________________DIRECT MAIL MARKETING Direct mail is the least expensive and most effective way for you to tell your full sales story to
your customers and prospects. I know you have thrown away a lot of direct mail literature and wondered just how such advertising could possibly pay off. The successful direct mail advertiser knows that a huge percentage of the people who receive a letter from them will probably do just as you have done: Throw it out. But if the letter is properly crafted and intelligently tested to a small segment of the list before being aggressively rolled out, it will indeed get sales from an impressive number of people.
In my own mailing experiences, we are perfectly satisfied if 95 out of 100 people receiving our cold prospect mailings don't open it, so long as half of the remaining five reply. Let's look at the math. (It's really simple.)
1. At a price of approximately 35 cents a letter, it costs about $350 to mail out 1,000 letters.
2. If only 2% (20 people) respond with an average sale of $100, the gross is $2,000 for the $350 spent.
3. Deduct 50% of gross for selling expenses and the $350 for mailing and advertising, then subtract 10% of the remaining for G&A (general and administrative) expenses.
4. A mere 2% response can still net almost $600 sheer profit for every 1,000 letters mailed out.
Obviously, if mailing a million letters gives the same percentage response (and it will), you can make a killing. Even half of that yield would still be pretty impressive. These returns are possible with the right lists and the right offer.
You Put A Salesperson At The Customer's Convenience
Let's assume you are in the manufacturing business: You make and sell products directly or through salespeople. You are succeeding modestly, but you crave higher profits.
Your sales staff calls on each account once every two or three months. Using properly crafted direct mail, you can call on many more prospects every month. And each "sales call" will cost you $1 or less, instead of $125 or more.
An intelligently crafted, direct mail offer can present your prospect with all your products or services or you can focus special attention on a single product. At their convenience your pros- pects can review and reflect on your selling proposition.
Time can work to your advantage. When you send the prospect a compelling direct mail letter, your customer isn't time-pressured to say "yes" or "no" within the 15 minutes your salesperson would get.
Your prospect has plenty of time to evaluate and reflect on your proposition.
You Generate New Business
You obviously don't have all the business or customers you would like to have or you wouldn't be reading this. Direct mail can help develop new customers and accounts.
You haven't acquired all the clients you want for a number of reasons:
• It isn't profitable or economical to solicit them through salespeople or via ads in magazines, newspapers, radio or TV
• It costs too much time and sales power to convert prospects to customers.